On 7 June 2018, the Belgian Court of Cassation, ruled that a decision of the Pharmacists Association Appeals Council (Appeals Council) prohibiting pharmacists from using Google Adwords to offer over-the-counter (OTC) products violated Belgian competition law because the Appeals Council did not sufficiently justify why such a prohibition was necessary for health reasons. The Appeals Council must now issue a new decision.
The Pharmacists Association (Orde van Apothekers - Ordre des Pharmaciens) is a professional association of pharmacists. Membership is mandatory partly to ensure that ethical and moral standards are maintained in the profession.
In the case at hand, the Appeals Council held that using Google Adwords for OTC products (i) lured customers into buying pharmacy products, (ii) resulted in customers not being able to access better care within their immediate geographical location and (iii) amounted to a "commercial exaggeration" contrary to the principles of honour and dignity, which lie at the core of the profession. The Appeals Council also held that the responsible distribution of medicine requires personal contact with pharmacists, which is displaced by the use of Google Adwords.
The Court of Cassation held that the decision of the Appeals Council violated competition law. It confirmed the applicability of competition rules to pharmacists, noting that despite their social role, pharmacists are involved in exchanging goods or services and are therefore 'undertakings' subject to competition law. In addition, the Court concluded that the Pharmacists Association is also subjected to competition law, even though it pursues a statutory and not an economic objective.
The Court considered that the Appeals council decision was based on the material interests of the pharmacists and general notions on the way the supply of medicine should be organised economically. Through its decision the Appeals council restricted competition without providing specific reasoning why the complainant would – through the use of Google Adwords for OTC products – endanger the public interest in terms of public health or the ethical standards of the profession.
This article was published in the Competition Law Newsletter of August 2018. Other articles in this newsletter:
- European Court of Justice dismissed Orange Polska’s appeal in abuse of dominance case
- General Court underlines importance of Commission's duty to state reasons
- General Court dismisses appeals by investor against power cable cartel fine
- Google receives a second record fine of EUR 34 billion for imposing restrictions on Android device makers
- European Commission issues a new Best Practices Code for State aid control
- District Court in the Netherlands rules on limitation periods in CRT case
- Court of Appeal in the Netherlands decides to appoint independent economic experts in TenneT v ABB